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Does the "I" in IBM Now Stand for India?

High-tech giant IBM Corp. has yet to issue an official comment, but according to the Wall Street Journal and other sources, IBM plans to cut as many as 5,000 U.S. employees, while opting to shift many of those jobs over to India. Based on the WSJ's estimates, IBM employs at least 74,000 people in India, which would be close to 20% of its total global workforce of 400,000.

IBM has long managed a significant international workforce, and according to the WSJ, even before the announcement of the 5,000 lost U.S. jobs, 71% of its employees were based outside of the United States, which of course is still where the company's headquarters are based.

Could this move to pare U.S. headcount be in anticipation of the rumored takeover of Sun Microsystems? Maybe. But an article in InformationWeek points to a potential political roadblock for IBM:

"espite some sound business reasons for offshoring, the job cuts come at a particularly sensitive time. IBM has been one of the most active tech vendors in terms of efforts to secure work funded by President Obama's multibillion-dollar stimulus package -- which largely aims to improve the nation's infrastructure while creating thousands of new jobs.


"Some IBM workers believe any jobs created by the stimulus package and other government programs should remain in the United States."

The InformationWeek article also speculates that the IBM may also be readying a bid to acquire Indian IT firm Satyam, which is known to be on the block.

TAGS: Supply Chain
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